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TITLE 26-INTERNAL REVENUE CODE tract" means, in respect of any individual, the sum of- (A) the total amount of the reductions before January 1, 1966, in his retired or re- tainer pay by reason of an election under chapter 73 of title 10 of the United States Code, and (B) any amounts deposited at any time by him pursuant to section 1438 or 1452(d) of such title 10. (Added Pub. L. 89-365, § l(a)(1), Mar. 8, 1966, 80 Stat. 32, and amended Pub. L. 93-406, title II, §§ 2005(c)(10), 2008(a), (b)(1), Sept. 2, 1974, 88 Stat. 992, 994.) AMENDME Ts 1974-Subsec. (a). Pub. L. 93-406, § 2008(a), substitut- ed "United States, gross income does not include the amount of any reduction in his retired or retainer pay pursuant to the provisions of chapter 73 of title 10, United States Code" for "United States who has made an election under chapter 73 of title 10 of the United States Code to receive a reduced amount of retired or retainer pay, gross income does not include the amount of any reduction after December 31, 1965, in his retired or retainer pay by reason of such election". Subsec. (b)(2). Pub. L. 93-406, § 2005(c)(10), substi- tuted "72(n)" for "72(o)". Subsec. (b)(2)(B). Pub. L. 93-406, § 2008(b)(1), insert- ed reference to section 1452(d) of title 10. EFFECTIVE DATE OF 1974 AMENDMENT Amendment by section 2005(c)(10) of Pub. L. 93-406 applicable only with respect to distributions or pay- ments made after Dec. 31, 1973, in taxable years begin- ning after Dec. 31, 1973, see section 2005(d) of Pub. L. 93-406, set out as an Effective Date of 1974 Amend- ment note under section 402 of this title. Section 2008(c) of Pub. L. 93-406 provided that: "The amendments made by this section [amending this section and sections 72, 101, and 2039 of this title] apply to taxable years ending on or after September 21, 1972. The amendments made by paragraphs (33 and (4) of subsection (b) [amending sections 101 and 2039 of this title] apply with respect to individuals dying on or after such date". EFFECTIVE DATE Section l(d) of Pub. L. 89-365 provided that: "The amendments made by subsections (a) and (b) [enact- ing this section and amending section 72 of this title] shall apply with respect to taxable years ending after December 31, 1965. The amendment made by subsec- tion (c) [amending section 101(b)(2)(D) of this title] shall apply with respect to individuals making an elec- tion under chapter 73 of title 10 of the United States Code who die after December 31, 1965." SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in section 72 of this title. § 123. Amounts received under insurance contracts for certain living expenses (a) General rule In the case of an individual whose principal residence is damaged or destroyed by fire, storm, or other casualty, or who is denied access to his principal residence by governmen- tal authorities because of the occurrence or threat of occurrence of such a casualty, gross income does not include amounts received by such individual under an insurance contract which are paid to compensate or reimburse such individual for living expenses incurred for himself and members of his household result- ing from the loss of use or occupancy of such residence. (b) Limitation Subsection (a) shall apply to amounts re- ceived by the taxpayer for living expenses in- curred during any period only to the extent the amounts received do not exceed the amount by which- (1) the actual living expenses incurred during such period for himself and members of his household resulting from the loss of use or occupancy of their residence, exceed (2) the normal living expenses which would have been incurred for himself and members of his household during such period. (Added Pub. L. 91-172, title IX, § 901(a), Dec. 30, 1969, 83 Stat. 709.) EFFECTIVE DATE Section 901(c) of Pib. L. 91-172 provided that: "The amendments made by this section [enacting this sec- tion] shall apply with respect to amounts received on or after January 1, 1969." § 124. Cross references to other acts (a) For exemption of- (1) Adjustments of indebtedness under wage earners' plans, see section 679 of the Bankruptcy Act (11 U.S.C. 1079). (2) Allowances and expenditures to meet losses sus- tained by persons serving the United States abroad, due to appreciation of foreign currencies, see section 5943 of title 5, United States Code. (3) Amounts credited to the Maritime Administration under section 9(b)(6) of the Merchant Ship Sales Act of 1946, see section 9(c)(l) of that Act (50 U.S.C. App. 1742). (4) Benefits under laws administered by the Veter- ans' Administration, see section 3101 of title 38, United States Code. (5) Earnings of ship contractors deposited in special reserve funds, see section 607(d) of the Merchant Marine Act, 1936 (46 U.S.C. 1177). (6) Income derived from Federal Reserve banks, in- cluding capital stock and surplus, see section 7 of the Federal Reserve Act (12 U.S.C. 531). (7) Railroad retirement annuities and pensions, see section 12 of the Railroad Retirement Act of 1935 (45 U.S.C. 2281). (8) Railroad unemployment benefits, see section 2(e) of the Railroad Unemployment Insurance Act (45 U.S.C. 352). (9) Special pensions of persons on Army and Navy medal of honor roll, see 38 U.S.C. 562(a)-(c). (b) For extension of military income tax-exemption benefits to commissioned officers of Public Health Ser- vice in certain circumstances, see section 212 of the Public Health Service Act (42 U.S.C. 213). (Aug. 16, 1954, ch. 736, 68A Stat. 39, § 121; Aug. 1, 1956, ch. 837, title V, § 501(t), 70 Stat. 885; June 17, 1957, Pub. L. 85-56, title XXII, § 2201(25), 71 Stat. 160; Sept. 2, 1958, Pub. L. 85-857, § 13(t) 72 Stat. 1266; renumbered § 122, Feb. 26, 1964, Pub. L. 88-272, title II, § 206(a), 78 Stat. 38; renumbered § 123, Mar. 8, 1966, Pub. L. 89-365, § 1(a)(1), 80 Stat. 32; renum- bered § 124, Dec. 30, 1969, Pub. L. 91-172, title IX, § 901(a), 83 Stat. 709; amended Oct. 4, 1976, Pub. L. 94-455, title XIX, § 1901(a)(21), 90 Stat. 1766.) REFERENCES IN TEXT Section 9 of the Merchant Ship Sales Act of 1946 (50 U.S.C. App. 1742), referred to in subsec. (a)(3), was re- Page 130 § 123