26 U.S.C. § 271
Section 271 · Debts owed by political parties, etc.
Amended 2 times on record
Applied in 57 court decisions — leading case Limited, Inc. v. Commissioner (2002)
Most recently applied in Nitschke v. Comm'r (May 2008)
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.
In the case of a taxpayer (other than a bank as defined in section 581) no deduction shall be allowed under section 166 (relating to bad debts) or under section 165(g) (relating to worthlessness of securities) by reason of the worthlessness of any debt owed by a political party.
(1) Political party
For purposes of subsection (a), the term “political party” means—
(A) a political party;
(B) a national, State, or local committee of a political party; or
(C) a committee, association, or organization which accepts contributions or makes expenditures for the purpose of influencing or attempting to influence the election of presidential or vice-presidential electors or of any individual whose name is presented for election to any Federal, State, or local elective public office, whether or not such individual is elected.
(2) Contributions
For purposes of paragraph (1)(C), the term “contributions” includes a gift, subscription, loan, advance, or deposit, of money, or anything of value, and includes a contract, promise, or agreement to make a contribution, whether or not legally enforceable.
(3) Expenditures
For purposes of paragraph (1)(C), the term “expenditures” includes a payment, distribution, loan, advance, deposit, or gift, of money, or anything of value, and includes a contract, promise, or agreement to make an expenditure, whether or not legally enforceable.
In the case of a taxpayer who uses an accrual method of accounting, subsection (a) shall not apply to a debt which accrued as a receivable on a bona fide sale of goods or services in the ordinary course of the taxpayer's trade or business if—
(1) for the taxable year in which such receivable accrued, more than 30 percent of all receivables which accrued in the ordinary course of the trades and businesses of the taxpayer were due from political parties, and
(2) the taxpayer made substantial continuing efforts to collect on the debt.
Editorial notes U.S. Code · Office of the Law Revision Counsel
Amendments
1976—Subsec. (c). Pub. L. 94–455 added subsec. (c).
Effective Date of 1976 Amendment
Section 2104(b) of Pub. L. 94–455 provided that: “The amendment made by subsection (a) [amending this section] shall apply to taxable years beginning after December 31, 1975.”