26 U.S.C. § 115
Section 115 · Income of States, municipalities, etc.
Amended 2 times on record
Applied in 445 court decisions — leading case Arrowsmith v. Commissioner (1952)
Most recently applied in S. Envtl. Law Ctr. v. N.C. R.R. Co. (August 2020)
Applied most in the Sixth Circuit Circuit (39 decisions)
Cases citing this section usually also cite 26 U.S.C. § 112 · 26 U.S.C. § 117 · 26 U.S.C. § 23
How often courts cite this section
Court decisions citing this, by year.Markers show enactment, consequential amendments, and circuit splits over this section — watch for a citation surge after a change or a disagreement. The dip in the last several years is a data-coverage gap, not a real trend — our corpus holds fewer opinions from the most recent years, so recent citations are undercounted.
Gross income does not include—
(1) income derived from any public utility or the exercise of any essential governmental function and accruing to a State or any political subdivision thereof, or the District of Columbia; or
(2) income accruing to the government of any possession of the United States, or any political subdivision thereof.
Editorial notes U.S. Code · Office of the Law Revision Counsel
Amendments
1976—Pub. L. 94–455 struck out “(a) General rule” before “Gross income does not include”, struck out subsecs. (b) and (c) which related to contracts concerning public utilities made before Sept. 8, 1916, and contracts concerning bridge acquisition made before May 29, 1928, respectively, and in par. (1) of former subsec. (a), struck out “or territory” after “accruing to a State”.
Effective Date of 1976 Amendment
Amendment by Pub. L. 94–455 applicable with respect to 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.