Pub. L. 86-707, tit. V, pt. C, sec. 523

Sec. 523. (a) Section 912 of the Internal Revenue Code of 1954 (relating to exemption for certain allowances) is amended to read as follows: “SEC. 912. EXEMPTIONS FOR CERTAIN ALLOWANCES. “The following items shall not be included in gross income, and shall be exempt from taxation under this subtitle: “(1) Foreign areas allowances.—In the case of civilian officers and employees of the Government of the United States, amounts received as allowances or otherwise (but not amounts received as post differentials) under— “(A) title IX of the Foreign Service Act of 1946, as amended (22 U.S.C., sec. 1131 and following), “(B) section 4 of the Central Intelligence Agency Act of 1949, as amended (50 U.S.C., sec. 403e), “(C) title II of the Overseas Differentials and Allowances Act, or “(D) subsection (e) or (f) of the first section of the Administrative Expenses Act of 1946, as amended, or section 22 of such Act. “(2) Cost-of-living allowances.—In the case of civilian officers or employees of the Government of the United States stationed outside the continental United States (other than Alaska), amounts (other than amounts received under title II of the Overseas Differentials and Allowances Act) received as cost-of-living allowances in accordance with regulations approved by the President.” (b) Paragraphs (1) and (2) of section 912 of the Internal Revenue Code of 1954, as amended by subsection (a) of this section, shall apply only with respect to amounts received on or after the date of the enactment of this Act in taxable years ending on or after such date.