The tax imposed by section 4371 shall not apply to—

(1) Effectively connected items

Any amount which is effectively connected with the conduct of a trade or business within the United States unless such amount is exempt from the application of section 882(a) pursuant to a treaty obligation of the United States.

(2) Indemnity bond

Any indemnity bond required to be filed by any person to secure payment of any pension, allowance, allotment, relief, or insurance by the United States, or to secure a duplicate for, or the payment of, any bond, note, certificate of indebtedness, war-saving certificate, warrant or check, issued by the United States.

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Terms Used In 26 USC 4373

  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • person: shall be construed to mean and include an individual, a trust, estate, partnership, association, company or corporation. See 26 USC 7701
  • trade or business: includes the performance of the functions of a public office. See 26 USC 7701
  • United States: when used in a geographical sense includes only the States and the District of Columbia. See 26 USC 7701