26 U.S.C. § 1045 — Rollover of gain from qualified small busi-

Page 2292 TITLE 26—INTERNAL REVENUE CODE [§ 1044 by this section [amending this section] shall apply to sales after the date of enactment of this Act [Dec. 20, 2006].’’ EFFECTIVE DATE OF 1990 AMENDMENT Pub. L. 101–508, title XI, § 11703(a)(2), Nov. 5, 1990, 104 Stat. 1388–517, provided that: ‘‘The amendment made by paragraph (1) [amending this section] shall apply to sales after November 30, 1989.’’ Pub. L. 101–280, § 6(a)(3), May 4, 1990, 104 Stat. 160, pro- vided that: ‘‘The amendment made by paragraph (1) [amending this section] and the provisions of paragraph (2) [set out below] shall apply to sales after November 30, 1989.’’ EFFECTIVE DATE Section applicable to sales after Nov. 30, 1989, see sec- tion 502(c) of Pub. L. 101–194, set out as an Effective Date of 1989 Amendment note under section 1016 of this title. PROPERTY SOLD BEFORE JUNE 19, 1990 Pub. L. 101–280, § 6(a)(2), May 4, 1990, 104 Stat. 160, pro- vided that: ‘‘(A) For purposes of section 1043 of such Code— ‘‘(i) any property sold before June 19, 1990, shall be treated as sold pursuant to a certificate of divestiture (as defined in subsection (b)(2) thereof) if such a cer- tificate is issued with respect to such sale before such date, and ‘‘(ii) in any such case, the 60-day period referred to in subsection (a) thereof shall not expire before the end of the 60-day period beginning on the date on which the certificate of divestiture was issued. ‘‘(B) Notwithstanding subparagraph (A), section 1043 of such Code shall not apply to any sale before April 19, 1990, unless— ‘‘(i) the sale was made in order to comply with an ethics agreement or pursuant to specific direction from the appropriate agency or confirming com- mittee, and ‘‘(ii) the justification for the sale meets the criteria set forth in subsection (b)(2)(A) thereof as imple- mented by the interim regulations implementing such section 1043, published on April 18, 1990.’’ [§ 1044. Repealed. Pub. L. 115–97, title I, § 13313(a), Dec. 22, 2017, 131 Stat. 2133] Section, added Pub. L. 103–66, title XIII, § 13114(a), Aug. 10, 1993, 107 Stat. 430; amended Pub. L. 104–188, title I, § 1703(a), Aug. 20, 1996, 110 Stat. 1875, related to rollover of publicly traded securities gain into special- ized small business investment companies. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal applicable to sales after Dec. 31, 2017, see sec- tion 13313(c) of Pub. L. 115–97, set out as an Effective Date of 2017 Amendment note under section 1016 of this title. § 1045. Rollover of gain from qualified small busi- ness stock to another qualified small busi- ness stock (a) Nonrecognition of gain In the case of any sale of qualified small busi- ness stock held by a taxpayer other than a cor- poration for more than 6 months and with re- spect to which such taxpayer elects the applica- tion of this section, gain from such sale shall be recognized only to the extent that the amount realized on such sale exceeds— (1) the cost of any qualified small business stock purchased by the taxpayer during the 60- day period beginning on the date of such sale, reduced by (2) any portion of such cost previously taken into account under this section. This section shall not apply to any gain which is treated as ordinary income for purposes of this title. (b) Definitions and special rules For purposes of this section— (1) Qualified small business stock The term ‘‘qualified small business stock’’ has the meaning given such term by section 1202(c). (2) Purchase A taxpayer shall be treated as having pur- chased any property if, but for paragraph (3), the unadjusted basis of such property in the hands of the taxpayer would be its cost (within the meaning of section 1012). (3) Basis adjustments If gain from any sale is not recognized by reason of subsection (a), such gain shall be ap- plied to reduce (in the order acquired) the basis for determining gain or loss of any quali- fied small business stock which is purchased by the taxpayer during the 60-day period de- scribed in subsection (a). (4) Holding period For purposes of determining whether the nonrecognition of gain under subsection (a) applies to stock which is sold— (A) the taxpayer’s holding period for such stock and the stock referred to in subsection (a)(1) shall be determined without regard to section 1223, and (B) only the first 6 months of the tax- payer’s holding period for the stock referred to in subsection (a)(1) shall be taken into ac- count for purposes of applying section 1202(c)(2). (5) Certain rules to apply Rules similar to the rules of subsections (f), (g), (h), (i), (j), and (k) of section 1202 shall apply. (Added Pub. L. 105–34, title III, § 313(a), Aug. 5, 1997, 111 Stat. 841; amended Pub. L. 105–206, title VI, § 6005(f), July 22, 1998, 112 Stat. 806.) Editorial Notes AMENDMENTS 1998—Subsec. (a). Pub. L. 105–206, § 6005(f)(1), in intro- ductory provisions, substituted ‘‘a taxpayer other than a corporation’’ for ‘‘an individual’’ and ‘‘such tax- payer’’ for ‘‘such individual’’. Subsec. (b)(5). Pub. L. 105–206, § 6005(f)(2), added par. (5). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1998 AMENDMENT Amendment by Pub. L. 105–206 effective, except as otherwise provided, as if included in the provisions of the Taxpayer Relief Act of 1997, Pub. L. 105–34, to which such amendment relates, see section 6024 of Pub. L. 105–206, set out as a note under section 1 of this title. EFFECTIVE DATE Section applicable to sales after Aug. 5, 1997, see sec- tion 313(c) of Pub. L. 105–34, set out as an Effective Date of 1997 Amendment note under section 1016 of this title. Page 2293 TITLE 26—INTERNAL REVENUE CODE § 1053 PART IV—SPECIAL RULES Sec. [1051. Repealed.] 1052. Basis established by the Revenue Act of 1932 or 1934 or by the Internal Revenue Code of 1939. 1053. Property acquired before March 1, 1913. 1054. Certain stock of Federal National Mortgage Association. 1055. Redeemable ground rents. [1056, 1057. Repealed.] 1058. Transfers of securities under certain agree- ments. 1059. Corporate shareholder’s basis in stock re- duced by nontaxed portion of extraordinary dividends. 1059A. Limitation on taxpayer’s basis or inventory cost in property imported from related per- sons. 1060. Special allocation rules for certain asset ac- quisitions. 1061. Partnership interests held in connection with performance of services. 1062. Cross references. Editorial Notes AMENDMENTS 2017—Pub. L. 115–97, title I, § 13309(b), Dec. 22, 2017, 131 Stat. 2131, added items 1061 and 1062 and struck out former item 1061 ‘‘Cross references’’. 2014—Pub. L. 113–295, div. A, title II, § 221(a)(78), Dec. 19, 2014, 128 Stat. 4049, struck out item 1051 ‘‘Property acquired during affiliation’’. 2004—Pub. L. 108–357, title VIII, § 886(b)(1)(B), Oct. 22, 2004, 118 Stat. 1641, struck out item 1056 ‘‘Basis limita- tion for player contracts transferred in connection with the the sale of a franchise’’. 1997—Pub. L. 105–34, title XI, § 1131(c)(5), Aug. 5, 1997, 111 Stat. 980, struck out item 1057 ‘‘Election to treat transfer to foreign trust, etc., as taxable exchange’’. 1986—Pub. L. 99–514, title VI, § 641(b), title XII, § 1248(b), Oct. 22, 1986, 100 Stat. 2283, 2584, added items 1059A and 1060 and renumbered former item 1060 as 1061. 1984—Pub. L. 98–369, div. A, title I, § 53(d), July 18, 1984, 98 Stat. 568, added item 1059 and renumbered former item 1059 as 1060. 1978—Pub. L. 95–345, § 2(d)(2), Aug. 15, 1978, 92 Stat. 483, added item 1058 and renumbered former item 1058 as 1059. 1976—Pub. L. 94–455, title II, § 212(a)(2), title X, 1015(c), Oct. 4, 1976, 90 Stat. 1546, 1618, added items 1056 and 1057 and renumbered former item 1056 as 1058. 1963—Pub. L. 88–9, § 1(d), Apr. 10, 1963, 77 Stat. 8, added item 1055 and renumbered former item 1055 as 1056. 1960—Pub. L. 86–779, § 8(c), Sept. 14, 1960, 74 Stat. 1003, renumbered former item 1054 as 1055 and added new item 1054. [§ 1051. Repealed. Pub. L. 113–295, div. A, title II, § 221(a)(78), Dec. 19, 2014, 128 Stat. 4049] Section, Aug. 16, 1954, ch. 736, 68A Stat. 310; Pub. L. 94–455, title XIX, §§ 1901(a)(131), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1786, 1834, related to property acquired by a corporation during affiliation. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal effective Dec. 19, 2014, subject to a savings provision, see section 221(b) of Pub. L. 113–295, set out as an Effective Date of 2014 Amendment note under sec- tion 1 of this title. § 1052. Basis established by the Revenue Act of 1932 or 1934 or by the Internal Revenue Code of 1939 (a) Revenue Act of 1932 If the property was acquired, after February 28, 1913, in any taxable year beginning before January 1, 1934, and the basis thereof, for pur- poses of the Revenue Act of 1932 was prescribed by section 113(a)(6), (7), or (9) of such Act (47 Stat. 199), then for purposes of this subtitle the basis shall be the same as the basis therein pre- scribed in the Revenue Act of 1932. (b) Revenue Act of 1934 If the property was acquired, after February 28, 1913, in any taxable year beginning before January 1, 1936, and the basis thereof, for pur- poses of the Revenue Act of 1934, was prescribed by section 113(a)(6), (7), or (8) of such Act (48 Stat. 706), then for purposes of this subtitle the basis shall be the same as the basis therein pre- scribed in the Revenue Act of 1934. (c) Internal Revenue Code of 1939 If the property was acquired, after February 28, 1913, in a transaction to which the Internal Revenue Code of 1939 applied, and the basis thereof, for purposes of the Internal Revenue Code of 1939, was prescribed by section 113(a)(6), (7), (8), (13), (15), (18), (19), or (23) of such code, then for purposes of this subtitle the basis shall be the same as the basis therein prescribed in the Internal Revenue Code of 1939. (Aug. 16, 1954, ch. 736, 68A Stat. 310.) Editorial Notes REFERENCES IN TEXT Revenue Act of 1932, referred to in section catchline and subsec. (a), is act June 6, 1932, ch. 209, 47 Stat. 169. For complete classification of the Act to the Code, see Tables. Revenue Act of 1934, referred to in section catchline and subsec. (b), is act May 10, 1934, ch. 277, 48 Stat. 680. For complete classification of this Act to the Code, see Tables. The Internal Revenue Code of 1939, referred to in sec- tion catchline and subsec. (c), is act Feb. 10, 1939, ch. 2, 53 Stat. 1. Prior to the enactment of the Internal Rev- enue Code of 1986 [formerly I.R.C. 1954], the 1939 Code was classified to former Title 26, Internal Revenue Code. For Table comparisons of the 1939 Code to the 1986 Code, see table I preceding section 1 of this title. Section 113 of the Internal Revenue Code of 1939, re- ferred to in subsec. (c), was classified to section 113 of former Title 26, Internal Revenue Code. Section 113 was repealed by section 7851(a)(1)(A) of this title. For table of comparisons of the 1939 Code to the 1986 Code, see Table I preceding section 1 of this title. See, also, sec- tion 7851(e) of this title for provision that references in the 1986 Code to a provision of the 1939 Code, not then applicable, shall be deemed a reference to the cor- responding provision of the 1986 Code, which is then ap- plicable. § 1053. Property acquired before March 1, 1913 In the case of property acquired before March 1, 1913, if the basis otherwise determined under this subtitle, adjusted (for the period before March 1, 1913) as provided in section 1016, is less than the fair market value of the property as of March 1, 1913, then the basis for determining gain shall be such fair market value. In deter-