---
kind: "section"
citation: "26 U.S.C. § 102"
title: "26"
title_heading: "Internal Revenue Code"
number: "102"
heading: "Gifts and inheritances"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/26/102"
units:
  - "Subtitle A — Income Taxes"
  - "Chapter 1 — Normal Taxes and Surtaxes"
  - "Subchapter B — Computation of Taxable Income"
  - "Part III — Items Specifically Excluded from Gross Income"
---

# §102. Gifts and inheritances

- (a) **General rule—** Gross income does not include the [value](/usc/26/851.md?p=c-4) of [property](/usc/26/317.md?p=a) acquired by gift, bequest, devise, or inheritance.
- (b) **Income—** [Subsection (a)](#a) shall not exclude from gross income—
  - (1) the income from any [property](/usc/26/317.md?p=a) referred to in [subsection (a)](#a); or
  - (2) where the gift, bequest, devise, or inheritance is of income from [property](/usc/26/317.md?p=a), the amount of such income.

  Where, under the terms of the gift, bequest, devise, or inheritance, the payment, crediting, or distribution thereof is to be made at intervals, then, to the extent that it is paid or credited or to be distributed out of income from [property](/usc/26/317.md?p=a), it shall be treated for purposes of [paragraph (2)](#b-2) as a gift, bequest, devise, or inheritance of income from [property](/usc/26/317.md?p=a). Any amount included in the gross income of a beneficiary under subchapter J shall be treated for purposes of [paragraph (2)](#b-2) as a gift, bequest, devise, or inheritance of income from [property](/usc/26/317.md?p=a).

- (c) **Employee gifts—**
  - (1) **In general—** [Subsection (a)](#a) shall not exclude from gross income any amount transferred by or for an employer to, or for the benefit of, an [employee](/usc/26/430.md?p=c-7-D-vi).
  - (2) **Cross references—** For provisions excluding certain [employee](/usc/26/430.md?p=c-7-D-vi) achievement awards from gross income, see [section 74(c)](/usc/26/74.md?p=c).

    For provisions excluding certain de minimis fringes from gross income, see [section 132(e)](/usc/26/132.md?p=e).


## Source credit

(Aug. 16, 1954, ch. 736, 68A Stat. 28; Pub. L. 99–514, title I, § 122(b), Oct. 22, 1986, 100 Stat. 2110.)

## Notes

### Editorial Notes

### Amendments

1986—Subsec. (c). Pub. L. 99–514 added subsec. (c).

### Statutory Notes and Related Subsidiaries

### Effective Date of 1986 Amendment

Amendment by Pub. L. 99–514 applicable to prizes and awards granted after Dec. 31, 1986, see section 151(c) of Pub. L. 99–514, set out as a note under section 1 of this title.