# § 873. Deductions
**(a)** **General rule** In the case of a nonresident alien individual, the deductions shall be allowed only for purposes of section 871(b) and (except as provided by subsection (b)) only if and to the extent that they are connected with income which is effectively connected with the conduct of a trade or business within the United States; and the proper apportionment and allocation of the deductions for this purpose shall be determined as provided in regulations prescribed by the Secretary.
**(b)** **Exceptions** The following deductions shall be allowed whether or not they are connected with income which is effectively connected with the conduct of a trade or business within the United States:
**(1)** **Losses** The deduction allowed by section 165 for casualty or theft losses described in paragraph (2) or (3) of section 165(c), but only if the loss is of property located within the United States.
**(2)** **Charitable contributions** The deduction for charitable contributions and gifts allowed by section 170.
**(3)** **Personal exemption** The deduction for personal exemptions allowed by section 151, except that only one exemption shall be allowed under section 151 unless the taxpayer is a resident of a contiguous country or is a national of the United States.
**(c)** **Cross reference** For rule that certain foreign taxes are not to be taken into account in determining deduction or credit, see section 906(b)(1).
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**Source Credit**: (Aug. 16, 1954, ch. 736, 68A Stat. 280; Pub. L. 89–809, title I, § 103(c)(1), Nov. 13, 1966, 80 Stat. 1550; Pub. L. 92–580, § 1(b), Oct. 27, 1972, 86 Stat. 1276; Pub. L. 94–455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 95–30, title I, § 101(d)(11), May 23, 1977, 91 Stat. 134; Pub. L. 98–369, div. A, title VII, § 711(c)(2)(A)(iv), July 18, 1984, 98 Stat. 945; Pub. L. 105–277, div. J, title IV, § 4004(b)(3), Oct. 21, 1998, 112 Stat. 2681–911.)
## Editorial Notes
### Amendments
1998—Subsec. (b)(1). amended heading and text of par. (1) generally. Prior to amendment, text read as follows: “The deduction for losses allowed by section 165(c)(3), but only if the loss is of property located within the United States.”
1984—Subsec. (b)(1). substituted “for losses” for “, for losses of property not connected with the trade or business if arising from certain casualties or theft,”.
1977—Subsec. (c). struck out par. (1) which made a cross reference to section 142(b)(1) for disallowance of the standard deduction and struck out “(2)” at beginning of single remaining cross reference.
1976—Subsec. (a). struck out “or his delegate” after “Secretary”.
1972—Subsec. (b)(3). substituted exception that only one exemption be allowed under section 151 unless the taxpayer is a resident of a contiguous country or is a national of the United States, for exception that in the case of a non-resident alien individual who is not a resident of a contiguous country only one exception be allowed under section 151.
1966— amended section generally, substituting “connected with income which is effectively connected with the conduct of a trade or business within the United States” for “connected with income from sources within the United States” in subsec. (a), striking out provisions relating to the deduction of losses not connected with a trade or business but incurred in transactions entered into for profit in subsec. (b), making the casualty loss deduction available even if the property giving rise to the loss is not effectively connected with the conduct of a trade or business in the United States if the property is located in this country, making the charitable contribution deduction available even though not related to the trade or business, and adding subsec. (c)(2) making a cross reference to section 906(b)(1) for rule that certain foreign taxes are not to be taken into account in determining deduction or credit.
## Statutory Notes and Related Subsidiaries
### Effective Date of 1998 Amendment
Amendment by applicable to taxable years beginning after , see , set out as a note under .
### Effective Date of 1984 Amendment
Amendment by applicable to taxable years beginning after , see , set out as a note under .
### Effective Date of 1977 Amendment
Amendment by applicable to taxable years beginning after , see , set out as a note under .
### Effective Date of 1972 Amendment
Amendment by applicable to taxable years beginning after , see , set out as a note under .
### Effective Date of 1966 Amendment
Amendment by applicable with respect to taxable years beginning after , see , set out as a note under .