22 October 2026

Rifat Jumagulov · How this is checked

The Adoption Credit Is Partly Refundable Now. Two Lists in the Tax Law Still Don't Name It.

Title 26, executed. Part 2 of a series; part 1 rebuilt the 2026 inflation adjustments from the statute.

We parsed the amending instructions of P.L. 119-21 — the One Big Beautiful Bill Act, or OBBBA — to Title 26 of the United States Code into 588 edits across 146 sections, applied them to the Code as it stood before enactment and compared the result with the official consolidation. 566 apply exactly as written. The findings come from the rest and from separate checks of related section lists: a refundable credit absent from the deficiency and refund-appropriation lists, an additional tax on the income from excess Trump account contributions absent from §26(b)(2), a cross-reference inside the Act to the wrong subsection, and eleven drafting errors, six of them without an editorial note in the Code.

Everything below can be checked from the cited text in minutes; the edits, the notes and the SHA-256 of every file are in a public repository, arxohq/arxo-pl119-21-amendments.

A credit and two lists

Section 70402(a) of the Act (139 Stat. 213) adds a paragraph to §23, the adoption credit:

So much of the credit allowed under paragraph (1) as does not exceed $5,000 shall be treated as a credit allowed under subpart C and not as a credit allowed under this subpart.

Subpart C is the subpart of refundable credits. A credit treated as allowed under subpart C that exceeds the tax is an overpayment under §6401(b)(1) and is refunded under §6402. That part of the mechanism needs no further amendment, and the credit is being paid: on October 16, 2026 the IRS said it has begun issuing refunds to more than 50,000 taxpayers whose adoption credit carryforwards from 2020 through 2024 increase the refundable portion of the credit for 2025 (IR-2026-123).

Two other provisions name refundable credits one by one. Both are unchanged.

26 U.S.C. §6211(b)(4)(A) is part of the definition of a deficiency. It treats as negative amounts of tax the excess of the credits allowable under

sections 21 by reason of subsection (g) thereof, 24 by reason of subsections (d) and (i)(1) thereof, 25A by reason of subsection (i) thereof, 32, 34, 35, 36, 36B, 6428, 6428A, 6428B, and 7527A

over the tax. Section 23 is not in the list.

31 U.S.C. §1324 is the permanent appropriation from which tax refunds are paid; subsection (b) limits what may be paid from it, and paragraph (2) covers refunds due from credit provisions of the Internal Revenue Code "enacted before January 1, 1978, or enacted by the Taxpayer Relief Act of 1997", and from named sections: 21, 24, 25A, 35, 36, 36A, 36B, 168(k)(4)(F), 53(e), 54B(h), 3131, 3132, 3134, 6428, 6428A, 6428B, 6431 and 7527A. Section 23 was added in 1996 (P.L. 104-188, §1807); the 1997 Act amended it but did not enact it, and paragraph (a)(4) dates from 2025. In 2021 Congress added "24" to the list although §24 itself is a 1997 enactment; the refundable rule then added, §24(i), was not. On that reading, which is a question of interpretation, §23(a)(4) is outside the 1997 clause. Section 23 is not in this list either.

In 2009, 2010 and 2021, when Congress made one of these credits refundable, in whole or in part, it named the section in both lists: §25A in 2009 (P.L. 111-5, §1004(b)(7) and (8)); the adoption credit itself in 2010, moved into subpart C as §36C (P.L. 111-148, §10909(b)(2)(N) and (P)); §21 and §24 for 2021 (P.L. 117-2, §9631(c) and §9611(b)(4)). H.R. 2833, the Adoption Tax Credit Refundability Act of 2025, would have moved the credit into subpart C as §36C again and named 36C in both lists (§2(a)(2)(E) and (G)). Section 70402 of the enacted law touches §23 alone; neither "6211" nor "1324" appears in it.

The one earlier gap of this kind was closed by a technical correction. The Taxpayer Relief Act of 1997 made part of the child tax credit refundable (§24(d)) without adding it to §6211(b)(4)(A); in 2000 Congress added "24(d)" to that list, effective as if included in the 1997 Act (P.L. 106-554).

Three statements are easy to run together here and should be kept apart: that the family is entitled to the credit — the Act says so, and nothing in these notes questions it; how a deficiency attributable to the refundable portion is determined under §6211; and which part of 31 U.S.C. §1324(b) covers the portion paid in excess of liability. The first is settled by the text. The other two are questions, not conclusions, and we have put them to those who can answer them. As far as we can find, JCS-1-26, the Joint Committee on Taxation's General Explanation of the Act (May 2026), describes the refundable portion and its indexation on pages 128–129 and does not discuss either list.

A correction, if one is wanted, needs two insertions, effective as if included in §70402: in §6211(b)(4)(A), insert "23 by reason of subsection (a)(4) thereof," after "21 by reason of subsection (g) thereof,"; in 31 U.S.C. §1324(b)(2), insert "23," after "section 21,", taking into account the prospective amendment of that list by P.L. 117-328.

What we did

The check is a machine check with legal reconciliation. We took the Act as printed at 139 Stat. 72 and the Code at OLRC release point 119-12, the last before enactment. Each amending instruction was written down as an edit — strike, insert after, add at the end, redesignate, amend to read as follows — and applied to the pre-enactment text, counting occurrences: "striking X" without "each place it appears" must find exactly one X, or the edit is held and the alternatives listed. The result was compared with OLRC releases 119-33 and 119-121, and every difference was classified individually.

588 edits across 146 sections; 566 execute exactly as written. The other 22 fall into four kinds: ten amend text that exists only after a prospective amendment by another Act (eight of them in §6724; §274(o); §461(l)(1)) and execute in their turn; eight are drafting problems in the Act itself, all in the table below; one, in §59A(i)(2), finds two occurrences but is resolved by the neighbouring instruction in the same paragraph; three use constructions our edit model does not represent (a heading boundary, "through the period") and were read individually. Each of the 22 carries a note in the repository's data/edits.csv. Seven provisions with rare constructions were not executed automatically; for them we rely on the OLRC text.

New and rewritten text was then checked for repeated designations, unbalanced parentheses and list punctuation, and the section lists that Congress usually amends together with a new provision were checked one by one. Each candidate was then compared with the OLRC editorial notes and the JCT footnotes; the table says which already appear there. Of the 216 section–provision pairs in the OLRC amendment notes, 202 are represented in the parsed edits; the rest are notes, References in Text, renumberings or an amendment of an earlier Act. An independent second extraction of a random sample of 30 instructions found no extraction errors, after accounting for differences in the starting text, and every item below was checked individually against the Statutes at Large page.

Trump accounts and regular tax liability

Section 70204(a) (139 Stat. 179) adds §530A. Its paragraph (d)(5) (139 Stat. 182) covers a contribution made before the calendar year in which the account beneficiary attains age 18, in excess of the annual limit. When the excess is distributed, the tax on the distributee "shall be increased by 100 percent of the amount of net income attributable to such excess" (subparagraph (C)).

Section 26(b)(2) names the chapter 1 taxes that are not part of "regular tax liability", the measure against which nonrefundable credits are limited, and the comparable taxes on account distributions are there: (E) §530(d)(4), Coverdell accounts; (Q) §220(f)(4), Archer MSAs; (U) §223(f)(4), health savings accounts; (Y) §529A(c)(3)(A), ABLE accounts; (Z) §24(j)(2), excess advance child tax credit payments. Section 530A(d)(5)(C) is not listed. As the text reads, this tax is part of regular tax liability, so otherwise available nonrefundable credits could offset it, unlike the taxes beside it. The omission is established; whether an exclusion was intended is a question. We found no discussion of the point in JCS-1-26.

(e) for (f)

Section 70202(c)(2) (139 Stat. 175) amends the information-reporting rules in §6041 for overtime:

(A) Section 6041(a), as amended by section 70201(e)(1)(A), is amended by inserting … (B) Section 6041(d), as amended by section 70201(e)(1)(B), is amended by striking …

Section 70201(e) is headed "Extension of Tip Credit to Beauty Service Business". The amendments to §6041 are in §70201(f)(1)(A) and (B) (139 Stat. 172). The same instruction has a separate defect: paragraph (c)(2)(A) inserts its words after "occupation of the person receiving such tips", but §70201(f)(1)(A) had already made that phrase read "the occupation described in section 224(d)(1) of the person receiving such tips", so the anchor does not occur. OLRC executed the insertion after the longer phrase "to reflect the probable intent of Congress"; its notes attribute the earlier change to §70201(f)(1)(A) and do not mention that the Act reads (e). Correcting (e) to (f) alone would not cure the anchor.

The senior deduction

Section 70103(a)(3) (139 Stat. 159) adds §151(d)(5)(C): "there shall be allowed a deduction in an amount equal to $6,000". Section 63(b) lists what an individual who does not itemize may deduct: paragraph (2) admits "the deduction for personal exemptions provided in section 151", and the Act added its other new non-itemizer deductions — §224, §225 and §163(h)(4) — as paragraphs (5) to (7). The senior deduction has no entry. Unless it is part of the deduction for personal exemptions, the text reads as making it an itemized deduction; the heading of §70103 treats it as part of that deduction, and headings are not operative text.

The IRS allows it whether or not the taxpayer itemizes (Schedule 1-A). The 2025 Instructions for Form 6251 treat it as a personal exemption added back to alternative minimum taxable income "as an adjustment under section 56(b)(5)(D)". There is no §56(b)(5)(D); the provision is §56(b)(1)(D). JCS-1-26 (footnote 26) says a technical correction may be necessary.

Eleven drafting errors, two differences between the Code and the Statutes at Large

Rows 8 to 18 of the table are the eleven drafting errors in the Act's own text: three duplicate designations (a second paragraph (4) in §1202(b) and in §45X(d); two subparagraphs (E) in §45Y(b)(1)), three wrong labels, and five slips of spelling and punctuation. Five carry an OLRC editorial note; six do not (rows 11 and 14 to 18), and one of those, §25(e)(1)(C), takes effect in 2027 and is not yet in the Code. Rows 23 and 24 are the two places where the Code as published differs from the Act: §170(p) reads "1,000 ($2,000" where the Act inserts "$1,000 ($2,000" — OLRC's own amendment note has the dollar sign — and §67(g)(2) lacks the final period printed at 139 Stat. 164. Both are for the Office of the Law Revision Counsel.

The table

These are 24 table entries, not 24 errors of equal weight: they include questions of reading, drafting slips and differences between the Code and the Act. "Noted by" means the point already appears in an OLRC editorial note or in JCS-1-26.

Check it yourself

For the two lists, five minutes: open 139 Stat. 213 in the govinfo PDF of P.L. 119-21 and read §70402(a); open §6211 and 31 U.S.C. §1324 on uscode.house.gov (or the Cornell LII copies of §6211 and §1324) and search each for "23"; then, in the Amendments notes under §6211 for 2010, find "36C", inserted by P.L. 111-148, §10909(b)(2)(N). For (e) and (f), put 139 Stat. 172 and 175 side by side. For the rest, data/edits.csv in the repository lists every edit with its result and, for each edit not executed as written, a note; SHA256SUMS and the README's sources table give the hash of every file, of each OLRC release and of the Act.

What we do not claim, and whom we told

We do not claim that any refund, payment or assessment is unlawful. The omissions in items 1 and 2 are textual; how the statute applies is for Congress, the Treasury, the IRS and the courts. We do not claim to know what Congress intended; where the text and a likely intent differ, we say so. We do not give tax advice; nothing here is a recommendation to amend a return or to depart from published IRS instructions.

On October 22, 2026 the notes were sent to the staff of the Joint Committee on Taxation; the Office of the Law Revision Counsel; the tax staff of the Senate Committee on Finance and of the House Committee on Ways and Means; the Treasury Office of Tax Legislative Counsel; the IRS National Public Liaison; the Government Accountability Office; the office of Rep. Danny K. Davis, the sponsor of H.R. 2833; and to the AICPA, the ABA Section of Taxation, NAEA, TEI, the National Council For Adoption, the Tax Law Center at NYU Law, the Center for Taxpayer Rights, ICI and SIFMA. Corrections to hi@arxo.io; they will be recorded in the repository.

Why we did this

A code is a text that gets executed: by the agency that administers it, by the consolidator who folds each new Act into it, by every model that computes a return from it. An amendment is an operation over that text — strike these words, insert those after this anchor — and it either executes or it does not. Either way the result deserves a second reader, and the second reader can be a machine with a lawyer beside it. An executable model of a code has to carry each amendment as an operation with a date, and the lists Congress amends together with a mechanism have to be checked whenever the mechanism changes. The adoption credit is the case where that check found two lists that do not name it.

Rifat Jumagulov, founder, Arxo Law.

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