Law 11 - Off-side

A player is in an off-side position if he is nearer to his opponents' goal-line than the ball, unless:
1. he is in his own half of the field of play, or
2. he is not nearer to his opponents' goal-line than at least two of his opponents.
A player shall only be declared off-side and penalized for being in an off-side position, if, at the moment the ball touches, or is played by, one of this team, he is, in the opinion of the referee
1. interfering with play or with an opponent, or
2. seeking to gain an advantage by being in that position.
A player shall not be declared off-side by the referee
1. merely because of his being in an off-side position, or
2. if he receives the ball direct from a goal-kick, a corner-kick or a throw-in.
If a player is declared off-side, the referee shall award an IFK, which shall be taken by a player of the opposing team from the place where the infringement occurred, unless the offense is committed by a player in his opponents' goal area, in which case the free-kick shall be taken from any point within the goal-area.

Decisions of the International F.A. Board

Off-side shall not be judged at the moment the player in question receives the ball, but at the moment when the ball is passed to him by one of his own side. A player who is not in an off-side position when one of his colleagues passes the ball to him or takes a free-kick, does not therefore become off-side if he goes forward during the flight of the ball.
A player who is level with the second last opponent or with the last two opponents is not in an off-side position.