SOURCE:  The Great IRS Hoax book, Section 6.3.8.

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The Code contains many footnotes and references to allow readers to search back and trace the origins and evolution of laws and regulations, since this often clarifies intent. IRC 61(a) on gross income used to have a footnote informing readers that it came from Section 22(a) of the 1939 Code and that the law hadn't been changed. The footnote said, "Source: Sec. 22(a), 1939 Code, substantially unchanged." That footnote was in the 1954 version of the Internal Revenue Code at least up to the 1982 edition, but then it vanished, making it difficult for tax professionals to understand how the wording has been deceptively altered, leading to misapplication of the law. Constitutional limitations discussed above were thus hidden.

Deletion of the footnote has also made it much more difficult to notice and understand the close connection between IRC 61 and IRC 861 (or CFR 1.61 and CFR 1.861), especially as 26 CFR § 1.861 is now thousands of pages distant from 26 CFR § 1.61, and in the earlier versions, the section was not numbered 861, but 119. In pre-1954 versions, the "gross income" regulations under Section 22(a) mentioned the taxable sources as income of nonresident aliens and foreign corporations doing business in the U.S. and its possessions and profits of citizens, residents, and domestic corporations derived from foreign commerce. The same sources were described in the regulations under IRC 119 "Income from sources within the United States."

The 1921 version was even more clear (and the law hasn't materially changed since then). It said explicitly "that in the case of a nonresident alien individual or of a citizen entitled to the benefits of section 262, the following items of gross income shall be treated as income from sources within the United States." (IRC 262 applied if at least 80% of a citizen's gross income was from a U.S. possession.)

In 1954, while the law still hadn't materially changed, the regulations were changed so that the "foreign" sources were omitted from the "gross income" description in CFR 1.61(a), but remained in the regulations as CFR 1.861 (renumbered from the regulations previously under IRC 119). Wording was put in those regulations stating that they "determine the sources of income for purposes of the income tax," and they stated that it was the foreign sources noted below that were the sources. These sources today are the ones listed in 26 CFR § 1.861-8(f)(1).