
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC703]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                        Subtitle A--Income Taxes
 
                  CHAPTER 1--NORMAL TAXES AND SURTAXES
 
                 Subchapter K--Partners and Partnerships
 
                 PART I--DETERMINATION OF TAX LIABILITY
 
Sec. 703. Partnership computations


(a) Income and deductions

    The taxable income of a partnership shall be computed in the same 
manner as in the case of an individual except that--
        (1) the items described in section 702(a) shall be separately 
    stated, and
        (2) the following deductions shall not be allowed to the 
    partnership:
            (A) the deductions for personal exemptions provided in 
        section 151,
            (B) the deduction for taxes provided in section 164(a) with 
        respect to taxes, described in section 901, paid or accrued to 
        foreign countries and to possessions of the United States,
            (C) the deduction for charitable contributions provided in 
        section 170,
            (D) the net operating loss deduction provided in section 
        172,
            (E) the additional itemized deductions for individuals 
        provided in part VII of subchapter B (sec. 211 and following), 
        and
            (F) the deduction for depletion under section 611 with 
        respect to oil and gas wells.

(b) Elections of the partnership

    Any election affecting the computation of taxable income derived 
from a partnership shall be made by the partnership, except that any 
election under--
        (1) subsection (b)(5) or (c)(3) of section 108 (relating to 
    income from discharge of indebtedness),
        (2) section 617 (relating to deduction and recapture of certain 
    mining exploration expenditures), or
        (3) section 901 (relating to taxes of foreign countries and 
    possessions of the United States),

shall be made by each partner separately.

(Aug. 16, 1954, ch. 736, 68A Stat. 240; Pub. L. 89-570, Sec. 2(b), Sept. 
12, 1966, 80 Stat. 764; Pub. L. 91-172, title V, Sec. 504(c)(3), Dec. 
30, 1969, 83 Stat. 633; Pub. L. 92-178, title III, Sec. 304(c), Dec. 10, 
1971, 85 Stat. 523; Pub. L. 94-12, title V, Sec. 501(b)(3), Mar. 29, 
1975, 89 Stat. 53; Pub. L. 94-455, title XIX, Sec. 1901(b)(21)(F), title 
XXI, Sec. 2115(c)(2), Oct. 4, 1976, 90 Stat. 1798, 1909; Pub. L. 95-30, 
title I, Sec. 101(d)(10), May 23, 1977, 91 Stat. 134; Pub. L. 96-589, 
Sec. 2(e)(1), Dec. 24, 1980, 94 Stat. 3396; Pub. L. 99-514, title V, 
Sec. 511(d)(2)(B), title VII, Sec. 701(e)(4)(E), Oct. 22, 1986, 100 
Stat. 2249, 2343; Pub. L. 100-647, title I, Sec. 1008(i), Nov. 10, 1988, 
102 Stat. 3445; Pub. L. 103-66, title XIII, Sec. 13150(c)(9), Aug. 10, 
1993, 107 Stat. 448.)


                               Amendments

    1993--Subsec. (b)(1). Pub. L. 103-66 substituted ``subsection (b)(5) 
or (c)(3)'' for ``subsection (b)(5)''.
    1988--Subsec. (b)(1). Pub. L. 100-647 substituted ``subsection 
(b)(5)'' for ``subsection (b)(5) or (d)(4)''.
    1986--Subsec. (b). Pub. L. 99-514 struck out former pars. (1) and 
(3) which related to elections under sections 57(c) and 163(d), 
respectively, and redesignated former pars. (2), (4), and (5), as pars. 
(1), (2), and (3), respectively.
    1980--Subsec. (b). Pub. L. 96-589 inserted reference to section 
108(b)(5) and (d)(4).
    1977--Subsec. (a)(2). Pub. L. 95-30 struck out subpar. (A) which 
made reference to the standard deduction provided in section 141, and 
redesignated subpars. (B) to (G) as (A) to (F), respectively.
    1976--Subsec. (a)(2)(G). Pub. L. 94-455, Sec. 2115(c)(2), 
substituted ``wells'' for ``production subject to the provisions of 
section 613A(c)''.
    Subsec. (b). Pub. L. 94-455, Sec. 1901(b)(21)(F), struck out ``under 
section 615 (relating to pre-1970 exploration expenditures),'' after 
``of the United States, and any election''.
    1975--Subsec. (a)(2)(G). Pub. L. 94-12 added subpar. (G).
    1971--Subsec. (b). Pub. L. 92-178 substituted ``,'' for ``or'' after 
``(relating to pre-1970 exploration expenditures)'' and inserted ``under 
section 57(c) (relating to definition of net lease), or under section 
163(d) (relating to limitation on interest on investment indebtedness)'' 
after ``(relating to deduction and recapture of certain mining 
exploration expenditures)''.
    1969--Subsec. (b). Pub. L. 91-172 substituted ``(relating to pre-
1970 exploration expenditures) or under section 617 (relating to 
deduction and recapture of certain mining exploration expenditures)'' 
for ``(relating to exploration expenditures) or under section 617 
(relating to additional exploration expenditures in the case of domestic 
mining)''.
    1966--Subsec. (b). Pub. L. 89-570 provided for election under 
section 615 (relating to exploration expenditures) or under section 617 
(relating to additional exploration expenditures in the case of domestic 
mining).


                    Effective Date of 1993 Amendment

    Amendment by Pub. L. 103-66 applicable to discharges after Dec. 31, 
1992, in taxable years ending after such date, see section 13150(d) of 
Pub. L. 103-66, set out as a note under section 108 of this title.


                    Effective Date of 1988 Amendment

    Amendment by Pub. L. 100-647 effective, except as otherwise 
provided, as if included in the provision of the Tax Reform Act of 1986, 
Pub. L. 99-514, to which such amendment relates, see section 1019(a) of 
Pub. L. 100-647, set out as a note under section 1 of this title.


                    Effective Date of 1986 Amendment

    Amendment by section 511(d)(2)(B) of Pub. L. 99-514 applicable to 
taxable years beginning after Dec. 31, 1986, see section 511(e) of Pub. 
L. 99-514, set out as a note under section 163 of this title.
    Amendment by section 701(e)(4)(E) of Pub. L. 99-514 applicable to 
taxable years beginning after Dec. 31, 1986, with certain exceptions and 
qualifications, see section 701(f) of Pub. L. 99-514, set out as an 
Effective Date note under section 55 of this title.


                    Effective Date of 1980 Amendment

    Amendment by Pub. L. 96-589 applicable to transactions which occur 
after Dec. 31, 1980, other than transactions which occur in a proceeding 
in a bankruptcy case or similar judicial proceeding or in a proceeding 
under Title 11 commencing on or after Dec. 31, 1980, with an exception 
permitting the debtor to make the amendment applicable to transactions 
occurring after Sept. 30, 1979; in a specified manner, see section 
7(a)(1), (f) of Pub. L. 96-589, set out as a note under section 108 of 
this title.


                    Effective Date of 1977 Amendment

    Amendment by Pub. L. 95-30 applicable to taxable years beginning 
after Dec. 31, 1976, see section 106(a) of Pub. L. 95-30, set out as a 
note under section 1 of this title.


                    Effective Date of 1976 Amendment

    Amendment by section 1901(b)(21)(F) of Pub. L. 94-455 effective for 
taxable years beginning after Dec. 31, 1976, see section 1901(d) of Pub. 
L. 94-455, set out as a note under section 2 of this title.
    Amendment by section 2115(c)(2) of Pub. L. 94-455 effective on Jan. 
1, 1975 and applicable to taxable years ending after Dec. 31, 1974, see 
section 2115(f) of Pub. L. 94-455, set out as a note under section 613A 
of this title.


                    Effective Date of 1975 Amendment

    Amendment by Pub. L. 94-12 effective Jan. 1, 1975, to apply to 
taxable years ending after Dec. 31, 1974, see section 501(c) of Pub. L. 
94-12, set out as an Effective Date note under section 613A of this 
title.


                    Effective Date of 1969 Amendment

    Amendment by Pub. L. 91-172 applicable with respect to exploration 
expenditures paid or incurred after Dec. 31, 1969, see section 504(d)(1) 
of Pub. L. 91-172, set out as an Effective Date note under section 243 
of this title.


                    Effective Date of 1966 Amendment

    Amendment by Pub. L. 89-570 applicable to taxable years ending after 
Sept. 12, 1966, but only in respect of expenditures paid or incurred 
after such date, see section 3 of Pub. L. 89-570, set out as an 
Effective Date note under section 617 of this title.


  Applicability of Certain Amendments by Pub. L. 99-514 in Relation to 
                   Treaty Obligations of United States

    For applicability of amendment by section 701(e)(4)(E) of Pub. L. 
99-514 notwithstanding any treaty obligation of the United States in 
effect on Oct. 22, 1986, with provision that for such purposes any 
amendment by title I of Pub. L. 100-647 be treated as if it had been 
included in the provision of Pub. L. 99-514 to which such amendment 
relates, see section 1012(aa)(2), (4) of Pub. L. 100-647, set out as a 
note under section 861 of this title.

                  Section Referred to in Other Sections

    This section is referred to in sections 705, 860C, 901, 1363, 1446 
of this title.
