(1) Except as provided in paragraph (a)(2) of this section, the white conductor must be employed for the grounded (neutral) circuit conductors only and must be connected to the white terminal or lead on receptacle outlets and fixtures. The grounded conductor must be the unswitched wire in switched circuits.

(2) A cable containing an insulated conductor with a white or natural gray outer finish or a marking of three continuous white stripes may be used for single-pole, three-way, or four-way switch loops, where this conductor is used for the supply to the switch, but not as a return conductor from the switch to the switched outlet. In these applications, the conductor with white or natural gray insulation or with three continuous white stripes must be permanently re-identified to indicate its use by painting or other effective means at its terminations and at each location where the conductor is visible and accessible.