§ 271 Debts owed by political parties, etc.

OLRC 119-134 · eCFR 2026-10-19 · 1 regs · 1 amending Acts · cited by 4 sections

Enacted 1954 · Act Aug. 16, 1954, ch. 736 Amended · 1 Acts · From 1939 Code § 23(k)(6)

19541976(a) General rule(b) Definitions(c) Exception
Connections Cited by 4 · Cites 3
§ 271 Debts owed by political parties, etc.
§ 1.271-1 Debts owed by political parties.

(a) General rule 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.

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    (b) Definitions

    (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.

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      (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.

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        (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.

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          (c) Exception 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—

          “In the case of a taxpayer who uses an accrual method of accounting, subsection (a)” Opening words
          “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” Opening words
          Textual readingALL OF= subsection (a) does not apply

          (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.

          “Substantial” implies facts and circumstances. No regulation cites this provision (eCFR, Oct 19, 2026)

          Amended 1976