--- slug: tax-advantaged-structures-by-statute title: "Tax-advantaged investment structures, by statute" kind: procedure status: published hash: 9dae724664cdda41edec77c10b6395d92abedfd0a1cfb819edbc3646738427c5 created: 2026-10-09T09:41:28.091Z updated: 2026-10-09T09:41:30.896Z summary: "Seven ways the Internal Revenue Code treats an investment differently, each with the section that says so and the words of the section. No returns are stated: no statute states one." tags: ["tax","irc","investing"] above: [] below: [] adjacent: [] nested: [] --- # Tax-advantaged investment structures, by statute *Seven ways the Internal Revenue Code treats an investment differently, each with the section that says so and the words of the section. No returns are stated: no statute states one.* ## Seven structures and the section behind each A “tax-free investment” is a treatment the Code gives to a kind of income, cost or gain. The table names the treatment, the section, and its words. The returns column is UNKNOWN on every row because no statute states a return. ```widget { "type": "table", "ref": "#facts.rows", "columns": [ { "key": "structure", "label": "Structure" }, { "key": "treatment", "label": "Treatment" }, { "key": "section", "label": "Section" }, { "key": "returns", "label": "Returns" } ], "title": "By statute" } ``` ```widget { "type": "json", "ref": "#facts.note", "title": "What this page is" } ``` ## Facts ```json { "rows": [ { "structure": "Oil and gas: intangible drilling and development costs", "treatment": "an option to deduct them as expenses", "section": { "url": "https://www.law.cornell.edu/uscode/text/26/263", "text": "26 U.S.C. § 263(c)" }, "returns": "UNKNOWN: no statute states a return" }, { "structure": "Oil and gas: percentage depletion", "treatment": "15 percent of gross income from the property, within the limits of § 613A", "section": { "url": "https://www.law.cornell.edu/uscode/text/26/613A", "text": "26 U.S.C. § 613A" }, "returns": "UNKNOWN: no statute states a return" }, { "structure": "Equipment (for example mining hardware): bonus depreciation", "treatment": "an allowance equal to 100 percent of the adjusted basis of qualified property in the year placed in service, for property placed in service after January 19, 2025", "section": { "url": "https://www.law.cornell.edu/uscode/text/26/168", "text": "26 U.S.C. § 168(k)" }, "returns": "UNKNOWN: no statute states a return" }, { "structure": "State and local bonds", "treatment": "gross income does not include the interest (with exceptions in § 103(b))", "section": { "url": "https://www.law.cornell.edu/uscode/text/26/103", "text": "26 U.S.C. § 103" }, "returns": "UNKNOWN: no statute states a return" }, { "structure": "Roth IRA", "treatment": "a qualified distribution is not includible in gross income", "section": { "url": "https://www.law.cornell.edu/uscode/text/26/408A", "text": "26 U.S.C. § 408A(d)" }, "returns": "UNKNOWN: no statute states a return" }, { "structure": "Like-kind exchange of real property", "treatment": "no gain or loss recognized on an exchange of real property held for productive use in a trade or business or for investment, solely for like-kind real property", "section": { "url": "https://www.law.cornell.edu/uscode/text/26/1031", "text": "26 U.S.C. § 1031(a)" }, "returns": "UNKNOWN: no statute states a return" }, { "structure": "Qualified opportunity fund", "treatment": "gain invested in a qualified opportunity fund within 180 days of the sale is excluded for that year, under the section’s conditions", "section": { "url": "https://www.law.cornell.edu/uscode/text/26/1400Z-2", "text": "26 U.S.C. § 1400Z-2" }, "returns": "UNKNOWN: no statute states a return" } ], "note": "This page is the text of the Code as published by Cornell’s Legal Information Institute, read on 2026-10-09. It states no return, ranks nothing and advises nothing; whether a structure applies to a person is a question for that person’s adviser." } ``` ## Sources 1. [26 U.S. Code § 263 - Capital expenditures](https://www.law.cornell.edu/uscode/text/26/263) — “the option to deduct as expenses intangible drilling and development costs in the case of oil and gas wells” (sha256 bc38d58edb3e6e13) 2. [26 U.S. Code § 613A - Limitations on percentage depletion in case of oil and gas wells](https://www.law.cornell.edu/uscode/text/26/613A) — “15 percent shall be deemed to be specified in subsection (b) of section 613” (sha256 e98dd2c2756d25a3) 3. [26 U.S. Code § 168 - Accelerated cost recovery system](https://www.law.cornell.edu/uscode/text/26/168) — “shall include an allowance equal to 100 percent of the adjusted basis of the qualified property” (sha256 3b31110950ba74d5) 4. [26 U.S. Code § 103 - Interest on State and local bonds](https://www.law.cornell.edu/uscode/text/26/103) — “gross income does not include interest on any State or local bond” (sha256 b99e653976b5526b) 5. [26 U.S. Code § 408A - Roth IRAs](https://www.law.cornell.edu/uscode/text/26/408A) — “Any qualified distribution from a Roth IRA shall not be includible in gross income.” (sha256 d0940f240abed5a8) 6. [26 U.S. Code § 1031 - Exchange of real property held for productive use or investment](https://www.law.cornell.edu/uscode/text/26/1031) — “No gain or loss shall be recognized on the exchange of real property held for productive use in a trade or business or for investment” (sha256 8fc06695c41732b4) 7. [26 U.S. Code § 1400Z–2 - Special rules for capital gains invested in opportunity zones](https://www.law.cornell.edu/uscode/text/26/1400Z-2) — “the aggregate amount invested by the taxpayer in a qualified opportunity fund during the 180-day period beginning on the date of such sale or exchange” (sha256 25fbdc2b33373bed)