republic-os/legal/us/code/title-26/chapter-1/section-122.md

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LegalText	26 U.S.C. § 122	Certain reduced uniformed services retirement pay	us	united_states_code	code_section	26	INTERNAL REVENUE CODE	1	NORMAL TAXES AND SURTAXES	122	26 U.S.C. § 122	current	119-100	2026-06-26	official	https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc26@119-100.zip	/us/usc/t26/s122	data/legal/raw/us/code/title-26/usc26.xml	5cb58bcd85814b9f14dd60174a9e3cfc025178751164c4c8a618969b32fab0c1	a261f094809116f42a96648a3d5eee80fa010379d67412551c21dd5c900b27f4	e66139711be48ccf96d4e5736e7a1d576df772b5ede54703863be4823aad75de	2026-07-04	official	legal us-code

26 U.S.C. § 122 - Certain reduced uniformed services retirement pay

Text

(a) General rule In the case of a member or former member of the uniformed services of the United States, gross income does not include the amount of any reduction in his retired or retainer pay pursuant to the provisions of chapter 73 of title 10, United States Code.

(b) Special rule (1) Amount excluded from gross income In the case of any individual referred to in subsection (a), all amounts received as retired or retainer pay shall be excluded from gross income until there has been so excluded an amount equal to the consideration for the contract. The preceding sentence shall apply only to the extent that the amounts received would, but for such sentence, be includible in gross income.

(2) Consideration for the contract For purposes of paragraph (1) and section 72(n), the term “consideration for the contract” means, in respect of any individual, the sum of—

(A) the total amount of the reductions before January 1, 1966, in his retired or retainer pay by reason of an election under chapter 73 of title 10 of the United States Code, and

(B) any amounts deposited at any time by him pursuant to section 1438 or 1452(d) of such title 10.

(Added Pub. L. 89–365, § 1(a)(1), Mar. 8, 1966, 80 Stat. 32; amended Pub. L. 93–406, title II, §§ 2005(c)(10), 2007(a), (b)(1), Sept. 2, 1974, 88 Stat. 992, 994; Pub. L. 113–295, div. A, title II, § 221(a)(21), Dec. 19, 2014, 128 Stat. 4040.)

Notes

Editorial Notes

Prior ProvisionsA prior section 122 was renumbered section 140 of this title.

Amendments2014—Subsec. (b)(1). Pub. L. 113–295 struck out “after December 31, 1965,” after “all amounts received”. 1974—Subsec. (a). Pub. L. 93–406, § 2007(a), substituted “United States, gross income does not include the amount of any reduction in his retired or retainer pay pursuant to the provisions of chapter 73 of title 10, United States Code” for “United States who has made an election under chapter 73 of title 10 of the United States Code to receive a reduced amount of retired or retainer pay, gross income does not include the amount of any reduction after December 31, 1965, in his retired or retainer pay by reason of such election”. Subsec. (b)(2). Pub. L. 93–406, § 2005(c)(10), substituted “72(n)” for “72(o)”. Subsec. (b)(2)(B). Pub. L. 93–406, § 2007(b)(1), inserted reference to section 1452(d) of title 10.

Statutory Notes and Related Subsidiaries

Effective Date of 2014 AmendmentAmendment by Pub. L. 113–295 effective Dec. 19, 2014, subject to a savings provision, see section 221(b) of Pub. L. 113–295, set out as a note under section 1 of this title.

Effective Date of 1974 AmendmentAmendment by section 2005(c)(10) of Pub. L. 93–406 applicable only with respect to distributions or payments made after Dec. 31, 1973, in taxable years beginning after Dec. 31, 1973, see section 2005(d) of Pub. L. 93–406, set out as a note under section 402 of this title. Pub. L. 93–406, title II, § 2007(c), Sept. 2, 1974, 88 Stat. 993, provided that: “The amendments made by this section [amending this section and sections 72, 101, and 2039 of this title] apply to taxable years ending on or after September 21, 1972. The amendments made by paragraphs (3) and (4) of subsection (b) [amending sections 101 and 2039 of this title] apply with respect to individuals dying on or after such date”.

Effective DatePub. L. 89–365, § 1(d), Mar. 10, 1966, 80 Stat. 33, provided that: “The amendments made by subsections (a) and (b) [enacting this section and amending section 72 of this title] shall apply with respect to taxable years ending after December 31, 1965. The amendment made by subsection (c) [amending section 101 of this title] shall apply with respect to individuals making an election under chapter 73 of title 10 of the United States Code who die after December 31, 1965.”