SOURCE:  The Great IRS Hoax book, Section 6.3.7.

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Prior to 1988, the title of Part I of Subchapter N (which begins with Section 861) was “Determination of sources of income” (which is still the heading of the related regulations).  In 1988, this title was changed to “Source rules and other general rules relating to foreign income.”  It should be mentioned that while titles of parts may give an indication of what the part is about, the title has no effect on the actual legal application.

“...nor shall any table of contents, table of cross references, or similar outline, analysis, or descriptive matter relating to the contents of this title be given any legal effect.”
[26 U.S.C. §7806(b)]

So when the title was changed (but the text of the law was not), the application of the law did not change.  What changed was the appearance of the table of contents.  Prior to the change, in light of the fact that the income tax applies to “income from whatever source derived,” the table of contents made the relevance of 26 U.S.C. §861 obvious:

Subtitle A, “Income taxes”
Chapter 1, “Normal taxes and surtaxes”
Subchapter N, “Tax based on income from sources within or without the United States”
Part I, “Determination of sources of income”
Section 861, “Income from sources within the United States”
(a) “Gross income from sources within the United States”
(b) “Taxable income from sources within the United States”

When the title of Part I was changed, and the new title stated that the part was about “foreign income,” it no longer appeared to be an obvious place for most people to look when determining their taxable income.  This would certainly have the effect of drawing attention away from Section 861.  Many tax professionals concede that Section 861 and the related regulations show income to be taxable only when it comes from certain activities related to international and foreign commerce.  The new title gives the appearance that the part has no relevance to most people, and should not even be examined. 

But this change resulted in a curious situation: a part whose title says it is about “foreign income” is identified as the part which (along with the related regulations) “determine[s] the sources of income for purposes of the income tax.”